Chain of demand: Bridge work builds up local economy

Every day, Interstate 5 carries an estimated 14,000 commercial vehicles through Oregon, bearing freight with a retail value of approximately $650 million. The soon-to-be-rebuilt Willamette River Bridge between Eugene and Springfield is a crucial segment of I-5, and makes a significant contribution to West Coast commerce.

With a cost of $147 million for construction alone, the replacement bridge also makes a significant contribution to the economy in the Willamette Valley. The Oregon Department of Transportation “went local” and filled three of its four main contracting positions for the project with Oregon companies – OBEC Consulting Engineers, Hamilton Construction and Slayden Construction. In turn, these companies set up a chain of demand by looking for local partners when they need to subcontract some of their work.

For example, Slayden Construction hired Dirt & Aggregate Interchange Inc. to perform a variety of work on the project, including realigning bike paths, building access roads, and installing temporary drainage and fencing. The Fairview company’s contract, worth almost $1 million, has enabled it to hire one new apprentice and at least two new laborers in the Eugene area.

“We’ve been fortunate because this work has allowed us to expand outside the 60-mile radius that our division typically covers,” said Corey Pelfrey, project manager and chief estimator for the company’s dirt and pipe division, which also includes guardrail.

Dirt & Aggregate Interchange rents housing from Pioneer Management for its workers or, if those units are full, they rent rooms at a local motel. The company also rents a storage yard in Eugene to house materials.

Perhaps even more significant for the area’s economy is that Dirt & Aggregate Interchange subcontracts with local rock suppliers, truckers and other specialists to help fulfill its contract with Slayden Construction. It turned to Pacific Corrugated Pipe Co. – a pipe supplier with a manufacturing plant in Eugene – for about $40,000 worth of corrugated steel pipe to be used as culverts on the Willamette River Bridge project. Pacific Corrugated Pipe has been in business since 1935, with an Oregon operation since the early 1970s.

“Our customers order anything from a few feet of pipe to more than a quarter of a million dollars worth of pipe and related products,” said Larry Wood, operations manager at Pacific Corrugated Pipe. “While this is more of a midsize order for us, every purchase helps us to keep the lights on and keep people employed.”

When Dirt & Aggregate Interchange had to remove concrete ditches on the bridge project, it took the concrete to a local aggregate supplier, Egge Sand & Gravel of Eugene. It crushed the concrete and reused it as fill. This project, in addition to other more substantial projects with Dirt & Aggregate Interchange, has benefited the company and ultimately meant it could expand its workforce.

“This contract has allowed us to provide Dirt & Aggregate with five to seven trucks, delivering materials to the jobsite daily, and gave us an opportunity to hire three to four additional drivers. That’s significant during this tough economic time,” said Mark Alberts, materials sales, transportation and dispatch manager for Egge Sand & Gravel. “Without the Willamette River Bridge work, we probably would not have hired any additional drivers.”

Egge Sand & Gravel, in business for 45 years, is a full-service company with extensive experience in the construction materials industry. According to Alberts, the company tries to spend all of its dollars locally.

There’s no doubt that economic rejuvenation provided by the Willamette River Bridge work will extend beyond the end of construction in 2012.

“ODOT is making good on its promise to invest in Oregon businesses and stimulate local economies,” Pelfrey said. “The Willamette River Bridge project is definitely helping us rev up our engines to keep growing.”

Thomas Lauer is the major projects branch manager for the Oregon Department of Transportation. Contact him at 503-986-6625.